Adelanto: City seeks water rate study (February 14, 2016)

Since the last hike in 2012, the Adelanto Public Utility Authority’s revenues have remained stagnant while operating costs have gone up, officials said.

[…] the situation of rising operating costs and stringent water use standards is not unique to Adelanto, with most water agencies across the state worrying about meeting bond covenants because they simply aren’t generating the same revenue as before the mandate.

Review comes after four-year hiatus since last increase

ADELANTO — The City Council recently backed a staff-recommended five-year water rate study at a cost not to exceed $25,000, a move that comes as the city’s public utility faces a tightening budget and in response to four years without a water rate increase.

The study was initially expected to be conducted in-house, but former Assistant Finance Director Vanessa Martinez, who had been retained in a consulting capacity, informed the city Jan. 22 that hiring a firm would be the best bet.

In a letter to city officials, Martinez wrote that any new rates would have to be set up so it is defensible, acknowledging that she lack(ed) the expertise to defend them in the new criteria and it being in compliance under Proposition 218.

So on Wednesday, the Council approved developing a request for proposals, accepting bids and awarding a contract for the study in order to address present and future water rates, usage and procurement.

An outside consultant recommended in October had quoted $18,000 to perform the study, a figure that City Councilman Charley Glasper at the time called ludicrous. Yet the quote pales in comparison to the roughly $60,000 that Martinez said her new employer paid for the review.

The study is meant to determine the suitability of current rates. Since the last hike in 2012, the Adelanto Public Utility Authority’s revenues have remained stagnant while operating costs have gone up, officials said.

Additionally, conditions imposed on the city for failing to meet 20 percent state-mandated water conservation — including the need to push public outreach, implement an active rebate program and audit the largest customers — are expected to only create more cost burden to the APUA.

In mid-October, the idea for study was rejected by the Council after it garnered major blowback. Mayor Rich Kerr and Mayor Pro Tem Jermaine Wright were adamant that they would not vote for rate hikes.

But the situation of rising operating costs and stringent water use standards is not unique to Adelanto, with most water agencies across the state worrying about meeting bond covenants because they simply aren’t generating the same revenue as before the mandate.

The city of Victorville, which recently held a workshop to discuss a consultant’s water rate study, will meet Tuesday afternoon to possibly act on a proposed rate increase.

Meanwhile, Martinez warned Adelanto leaders in October that significant increases would become more necessary the longer the Council waited to proceed with rate adjustments. She added that the city’s current rates fell somewhere in the middle when compared to other municipalities in the High Desert.